This study examined changes in use of funding formulas for higher education among the states, the use of information about peer institutions in funding decisions, and the use of outcome or quality measures. The study used data from surveys of all states in 1984, 1988, and 1992. The most recent survey showed that 33 states were using formulas in 1988 and 1992, down from 36 in 1984. The number of states using peer data or comparisons in their funding formulas or guidelines grew from 3 in 1984 to 27 in 1988 to 28 in 1992. These peer data were used for salary determinations, for tuition and fee setting, and for determining funding for libraries. The number of states using outcome or quality measures declined from 20 in 1988 to 10 in 1992. Overall the data indicated that formulas are becoming more complex with more factors and the use of peer data. In addition, institutions are attempting to protect base budgets at the expense of using formulas as evidenced by the rapid decline in the number of states that incorporate quality or outcome measures in their formulas. In addition, states are attempting to address equity (both vertical and horizontal) concerns through funding formulas. (Contains 10 references.) (JB)